One of the better performing tech stocks this year has been Vancouver’s Counterpath (TSX:CCV). On August 20th, after listing on the Nasdaq earlier in the year, the company graduated to the TSX from the TSX Venture Exchange.
Byron Capital analyst Tom Astle says we may be only seeing the tip of the iceberg with Counterpath. Astle recently spent a day with management and says the meeting reinforced his view that the company remains one of the more compelling emerging tech names. He says Counterpath’s “…key strengths in VoIP, mobile apps and fixed-mobile convergence technologies, along with its strong relationships with carriers and other equipment vendors, make it a well-positioned company.” In a research update to clients today, Astle reiterated his Speculative Buy rating and $3.25 target on the stock.
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Counterpath was founded in 2002, and came to public attention in 2007 when telecom legend Terry Matthews became its chairman, a role he maintains today. After years of building out its suite of patented softphone products, such as Bria and X-Lite (which became the most popular free softphone in the world in 2009 when it reached 340,000 downloads a month), the company’s revenue has begun to climb of late. Counterpath’s recently reported Q3 numbers were a record $3.5-million, which was an increase of 15% over the $3-million it reported in the same period a year prior. In July, the company followed other Terry Matthew’s chaired concerns Mitel and Dragonwave, listing its shares on the Nasdaq.
Astle says Counterpath occupies a potentially lucrative space because its technology gives carriers the tools to battle online services such as Skype, Google Voice and Apple’s Facetime. He says the company’s implementation of Rogers One Number, which uses Counterpath software to integrate a subscriber’s mobile number with with a desktop softphone that includes email and text messaging, is an important milestone that could lead to more carrier business.
Shares of Counterpath on the TSX closed today down 5.7% to $2.50.